I’ve spoken with many knowledgeable people from the private sector across Canada and around the world. Their consensus is that we are definitely playing “catch-up” here and that the crown agencies should do three things.
1.Concentrate initially on their monopoly market, including embracing account-based wagering and mobile technology. Statistics Canada tells us that three quarters of Canadian households have at least one mobile phone and that 35% of younger households (18-34) rely exclusively on cell phones.
That’s a lot of “no-cost” lottery terminals directly in potential customers hands, which should lower distribution costs, drive new incremental sales and complement existing infrastructure.
2.Continue the effort to have the Criminal Code amended to allow single-event sports betting.
It would be interesting to know just how much money was bet by Canadians on the Canada – USA Olympic Gold Medal game.
3.Explore partnering with the private sector internet gaming companies that have shown a willingness to submit to proper regulation and appropriate taxation.
They point out that these companies already “own the business”, aren’t about to simply go away and also that they own and continue to develop the cutting-edge technology required to compete in the space.
Their position is that proceeding in this fashion would allow provincial governments to concentrate on the development of effective regulatory environments and to be perceived by the general public as fulfilling their consumer protection mandates, as well as accomplishing the crown agencies’ publicly stated goal of creating safe and secure internet gaming options for their citizens, while at the same time accessing new additional revenues for the agencies in a cost effective manner. Further, such an approach may well lead to access to a share of revenues from beyond Canadian shores.
The first two suggestions are self-evident. The third is obviously more contentious as it speaks to the operational choices available to provincial governments and their agencies – should they build, own and operate igaming sites and compete head-on; contract or partner with one or more existing operator (including on a “white label” basis); or simply tax and regulate. Each has its merits and drawbacks.
As I’ve said before, this question will not be answered lightly as we move forward from announcements of intention to operations.
By Bill Rutsey, President and CEO of the Canadian Gaming Association